Govt. may propose 90-day time limit to avail deposit insurance cover

According to the sources, the government may propose a 90-day time limit to avail deposit insurance cover. The government is working on Deposit Insurance Credit Guarantee Corporation (DICGC) Act amendments. This 90-day time limit will likely be made to avail deposit insurance for banks in distress.

Deposit insurance is a protection cover against losses accruing to bank deposits if a bank fails financially and has no money to pay its depositors. As per the current rule, the limit of the total amount payable by DICGC to any depositor with respect to the deposits with the bank is Rs. 5 lakh.